The End is Officially In Sight

This morning I made a payment of $4,662.48 onto my student loan debt. My tax refund finally came in, and it was huge. I qualified for a pretty sweet refund because of my previous tuition payments, and I’ll probably never have a return like that again, so I didn’t screw around trying to figure out what to do with it. After paying for my Turbotax receipt, the rest went to my student loans.

The result? I now owe $5,132.66 on my student loans.

Ladies and gentlemen, the end is officially in sight.

Let’s forget for a moment that I still have around $8,000 owing on my car that I’ll be tackling after my student loans are gone. Let’s forget for a moment that I still have a wedding to pay for, let’s just focus on the fact that I’ve paid off $24,805 in 16 months. Let’s focus on the fact that, if I don’t hit any bumps in the road, my student loans will be gone before I get married this summer.

With a little over $5,000 left owing on my student loans, I’m finally starting to visualize what it’s going to be like with no debt at all, or at least with just a car loan and no student loan. Life will be simpler. I’m not going to stop paying down my debt just because my student loans are gone, but knowing that they’re gone, and that I’ve only got my car loan to focus on, is going to be a huge weight off my shoulders. That weight has been getting lighter and lighter as my debts have decreased, but once that student loan is gone, I know I’m going to feel a big difference.

The Role Of Windfall Money In Debt Repayment

I didn’t manage to pay down so much debt in so little time by just buckling down, budgeting, and throwing all of my extra cash at my debt. I haven’t been in the work force long, I don’t make very much money, so there wasn’t a whole lot of extra going around for debt repayment. A good chunk of what I’ve managed to pay off has come from windfall money, or money that I wasn’t expecting to receive.

In the past, if I got a big tax return like this, I would’ve been tempted to spend it. When I turned 21, I went to Vegas for a week, and paid for that trip with my tax return. Nowadays, I know better. I never expect to receive windfall money, I’m not counting on it in any way, so why not just put it towards debt? The amounts never seem to be very much at the time, and I’m always tempted to spend them, rationalizing it as “it’s not going to make that much of a difference anyway”. It really does though, and since starting to pay off my debt, I’ve thrown at least $10,000 in unexpected money at my student loans.

The Way Forward

I owe $5,132.66 left on my student loans, and $8,050.00 on my car loan. If everything goes according to plan, I should have my student loans paid off before my wedding in June. My home province offers a nice little rebate to student loan slaves who had provincial income tax payable, and applying for that should net me another $1,900 in windfall money, which I’m planning on putting towards my student loans. I’m also planning on paying at least $1,000 per month towards them, and whatever else I can scrape together from my side hustle.

After my student loans are paid off, I plan on attacking my car loan with the same enthusiasm I’ve directed at my student loans. If nothing bad happens this year, and I don’t experience any bumps in the road, then maybe, just maybe, I could be debt free by the end of this year.

This post excites me for so many reasons. First and foremost, even though our numbers are different, I think we are in a really similar place in our debt repayment journeys. Being able to see the end is so freaking motivating. Your tax return was HUGE and I’m so proud of you for putting it all on your debt! Now, the maybe’s will always be there… but I have a feeling you’ll be debt-free in 2013. Way to go, Jordann!

When I read your tax return post I had the same feeling, we’re both on the tail end of debt repayment. I really, really hope I can get all of my debt paid off in 2013, but I still have so far to go, it seems close to impossible still!

Spitfire 6

I paid off all of my credit cards, blew some & saved some. I wish I would have saved more, but I can’t take that back– just move on from here.

Focus on the good: All of your credit cards are paid off! That’s amazing! I’m about $10 away from paying off a small balance I’ve been holding on mine for a few months, that’s going to feel great!

Laurie @thefrugalfarmer

Congrats, Jordann! Great job, by the way, on working so hard at debt reduction. We got about $3600 back this year: $1600 went toward necessary expenses, and the with the other 2k we went to Disneyworld. JUST KIDDING! We actually took it and established an emergency fund – yea!

We’ve already saved enough cash on the side to pay for the wedding in cash, and hopefully nothing will come up that will require us to dip into a line of credit or anything like that. In fact, one of my goals for the year is to get married without incurring debt.

Whoa – that’s fantastic!!! So glad the light at the end of the tunnel is getting brighter now. 🙂 My spouse switched jobs last year, thereby paying into CPP & EI twice, which has resulted in a pretty big tax return coming our way as well. It will go straight to the mortgage, without much though. I’m kind of relieved to find out we’re getting a return that big, because I didn’t want to have to adjust my lifestyle to come up with an extra $2K by August!

That is amazing! Congrats! What a great feeling. I got a small tax refund of roughly $400…..put it all towards my debt too. It was small mostly because I did a lot of independent contractor work which was untaxed, so it evened out. It’s motivating for me, someone who is nowhere near being debt fee, to see others so close to the end!

Nice!!! We are still neck and neck and definitely think both of us will be debt free by the end of the year. I have a somewhat difficult goal set of July 1, but it’s OK! I like the challenge! And yay for no more student loans by your wedding!

I am so unbelievably jealous but also so happy for you. That is such a major accomplishment and something to be truly proud of! I am almost at the $15,000 mark for my student loans and that is a big milestone for me! hehe. have yet to file our taxes since I’m still waiting on one lousy tax form.

$24,805 in 16 months is incredible! And debt free by the end of the year, even better! I’m so excited for you. You’ve really been killing it. I’m predicting an uneventful (bad events) rest of the year. Woo hoo!

Congratulations!!! I’m sure you are very happy right now but just wait until you get to debt freedom!! You will be over the moon. I haven’t done my taxes but I’m sure I’ll be paying something or I won’t get anything at all. I’m doing my own taxes this year for the first time and am procrastinating but I just need to take the time and get it done. Keep up the great work!!

As a self-employed person, I’ve never received a tax refund because nobody withholds taxes on my behalf. I generally owe quite a bit at tax time for income taxes, CPP, and HST. Sometimes my expenses are quite high and keep me in the “poor bugger” tax bracket. There have been a few years where the tax credits have worked in my favour because of this and I wind up getting some money back. But it’s generally never more than the HST I owe. So on a “good” year I have close to a net Zero. On “bad” years I owe thousands.

Huge Congrats Jordann!! We didn’t get a huge refund but we split it between paying off a personal loan and setting some aside for our family reunion this summer given that we couldn’t rally save for it with me being on mat leave.

That is awesome!! I just started my own plan for debt reduction. First plan is to pay off credit cards and my 401k loans. Second plan is for a consolidation loan, ATV and auto loans. I liked the idea of two plans so I can feel more accomplished.

That is amazing. You give me hope for my $30,000 student loan debt. I recently just started my career and have a lot ahead of me. But it is GREAT to know that I might not have to be celebrating my 50th birthday when I finally pay off my student debt and my husbands.